Correlation Between Oakley Capital and Bloomsbury Publishing
Can any of the company-specific risk be diversified away by investing in both Oakley Capital and Bloomsbury Publishing at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Oakley Capital and Bloomsbury Publishing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakley Capital Investments and Bloomsbury Publishing Plc, you can compare the effects of market volatilities on Oakley Capital and Bloomsbury Publishing and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Oakley Capital with a short position of Bloomsbury Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakley Capital and Bloomsbury Publishing.
Diversification Opportunities for Oakley Capital and Bloomsbury Publishing
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Oakley and Bloomsbury is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Oakley Capital Investments and Bloomsbury Publishing Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloomsbury Publishing Plc and Oakley Capital is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Oakley Capital Investments are associated (or correlated) with Bloomsbury Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloomsbury Publishing Plc has no effect on the direction of Oakley Capital i.e., Oakley Capital and Bloomsbury Publishing go up and down completely randomly.
Pair Corralation between Oakley Capital and Bloomsbury Publishing
Assuming the 90 days trading horizon Oakley Capital Investments is expected to generate 0.43 times more return on investment than Bloomsbury Publishing. However, Oakley Capital Investments is 2.3 times less risky than Bloomsbury Publishing. It trades about -0.16 of its potential returns per unit of risk. Bloomsbury Publishing Plc is currently generating about -0.22 per unit of risk. If you would invest 49,800 in Oakley Capital Investments on August 28, 2024 and sell it today you would lose (1,150) from holding Oakley Capital Investments or give up 2.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oakley Capital Investments vs. Bloomsbury Publishing Plc
Performance |
| Timeline |
| Oakley Capital Inves |
| Bloomsbury Publishing Plc |
Oakley Capital and Bloomsbury Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakley Capital and Bloomsbury Publishing
The main advantage of trading using opposite Oakley Capital and Bloomsbury Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakley Capital position performs unexpectedly, Bloomsbury Publishing can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bloomsbury Publishing will offset losses from the drop in Bloomsbury Publishing's long position.| Oakley Capital vs. Catalyst Media Group | Oakley Capital vs. Oncimmune Holdings plc | Oakley Capital vs. Invesco Health Care | Oakley Capital vs. Coor Service Management |
| Bloomsbury Publishing vs. Electronic Arts | Bloomsbury Publishing vs. Samsung Electronics Co | Bloomsbury Publishing vs. Ebro Foods | Bloomsbury Publishing vs. LPKF Laser Electronics |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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